In The Cards: Members Group Helping Convert ATM To Debit

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Citing the growth in debit volume, The Members Group here said it is working with client CUs to convert their ATM cards to debit cards as a means of increasing relationships.

"There are all kinds of statistics available that talk about the explosive growth of debit transactions over the last five years, and we have seen that reflected in the credit unions we work with," said Chris Gunnare, senior vice president of account management. "Consumers are becoming more comfortable with the idea of using plastic at the gas pump, the grocery store and at fast food restaurants. They want more versatility than a simple ATM card can offer them."

Despite that, The Members Group noted that many consumers still don't carry debit cards. A recent Visa study suggested that only one-in-four consumers actually have a debit card.

"There are a number of reasons why credit unions haven't moved their ATM cards to debit cards. In some cases, the ATM card is tied only to a savings account, or members have requested an ATM card only, but these are increasingly in the minority," Gunnare said. "Credit unions are beginning to understand that with the increased member awareness and comfort with debit cards there comes an increase in the number of debit transactions. This means there is an new opportunity for income."

The Members Group cited response to a campaign run by the $1.1-billion Premier America Credit Union in Southern California, as being indicative of the opportunities available.

"We actually converted most of our ATM cards to debit cards several years ago," said Marge McNaught, Senior Vice President of Lending and Technology for Premier America. "Although we made it very easy for members to opt out of the conversion, we had a very low cancellation rate and saw significant and sustained increases in interchange income from our members' use of the debit cards we issued. At that time we chose not to convert some of the more 'questionable' cards such as cases where a member had two ATM cards with access to different accounts, or ATM cards for seniors."

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